Nowhere to Hide

0
19
Asian Economic Slowdown

It’s a dangerous time for traditional investments and established financial institutions.  The headline from an October 20 Wall Street Journal story tells the tale:

Financial Markets Face Fresh Wave of Political Uncertainty:

‘There’s Literally Nowhere to Hide’ 

Investors spooked by widespread turmoil are seeking havens

The story highlights the battle over UK Brexit as “highlighting the extreme levels of uncertainty that some investors worry isn’t being properly accounted for with U.S. stocks near all-time highs.”

But the challenges are bigger than Brexit:

“The U.S.-China trade war, Britain leaving the EU and impeachment proceedings in the U.S. are just some of the major political obstacles facing investors. Adding to the uncertainty is the Turkish military operation in Syria, attacks on Saudi oil production, and social unrest spanning from Hong Kong to Barcelona.

“In response, some investors are boosting holdings of cash and other assets that tend to hold their value when markets turn rocky. Others are recommending strategies that could protect against a swift downturn.

It is an era of financial challenges, most of which we detail in our blog posts and briefings.  The Wall Street Journal tells us investors are “spooked,” need to “hide,” and are seeking “havens.”

Those of us that have made a lifelong study of these periods of “political uncertainty” and “turmoil” know that the haven they seek is real money, gold.

But, predictably, it is not until the 21st paragraph, the next to the last paragraph, that the word “gold” finally appeasers in the WSJ story.  And even then it is in the typically disreputable company:  “Esty Dwek, head of global market strategy at Natixis Investment Managers, said she favors gold and the Japanese yen given the ever-changing geopolitical backdrop.”

The Japanese yen?  They lump gold in with the Japanese yen, another notoriously troubled, unbacked, massively emitted, destined-for-worthlessness paper currency?

Oh well.  The establishment financial press can not help itself, any more than central bankers can stop responding to every problem with another round of “liquidity operations,” money printing under its endless variety of names:  monetary injections, quantitative easing, debt monetization, interest rate management, reserve adjustments, and more.

For those not mesmerized by the mainstream media and the failing institutions it serves, there is a haven of safety and place to profit.  We know, because this isn’t our first rodeo.  It’s not the only time the world has experienced political uncertainty and widespread turmoil.

Find out more about gold’s place in your portfolio.  Contact an RME Gold professional today.